(Last Word) Starbucks should continue to add stores in a city Multiple Choice as long as the gap between marginal benefits and marginal costs is growing. as long as the marginal benefit of opening a new location does not fall below the marginal cost. as long as the marginal cost of opening a new location does not fall below the marginal benefit. until all remaining competing coffee stores have left the market.

T-comm makes a variety of products. it is organized in two divisions, north and south. the managers for each division are paid, in part, based on the financial performance of their divisions. the south division normally sells to outside customers but, on occasion, also sells to the north division. when it does, corporate policy states that the price must be cost plus 20 percent to ensure a "fair" return to the selling division. south received an order from north for 300 units. south's planned output for the year had been 1,200 units before north's order. south's capacity is 1,500 units per year. the costs for producing those 1,200 units follow